We've known for some time that Kerkorian, who is still MGM's largest shareholder, had plans to leave MGM behind. He announced in October that he had sold 32 million shares of MGM and may be willing to part with the rest. Besides the terrible timing in the market, the move out of MGM seems to be a slow and steady one.

Still the worst bet in townSo, this is a big discount that investors should jump on, right? Not so fast.

If the U.S. economy does take a turn for the worse, as the market fears, MGM will be the hardest hit. Most of MGM's revenue still comes from Las Vegas, and if we remember what happened to gaming, room rates, and earnings during the last recession, the damage wouldn't be pretty.

Foolish bottom lineThe recent market downturn and sale by Kerkorian hasn't changed anything about MGM; it's just brought the company's problems to the forefront. And despite the recent discount, I wouldn't make a big bet on MGM Resorts.

Interested in reading more about gaming stocks? Add your favorite to My Watchlist, and My Watchlist will find all of our Foolish analysis on the stock.

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment icon found on every comment.

"We believe MGM Resorts is ideally positioned to take advantage of both domestic and international opportunities, and is executing well on its business strategy. Moreover, the acquisition of a controlling interest in MGM China will strengthen its position in Macau and ensure higher profitability. Business at Las Vegas has begun to stabilize, MGM Grand Detroit also reported strong growth and results at MGM Macau and CityCenter were also impressive in the reported quarter."

As reported by a more informed group of analysts in my view. Do your own reserch, but I would be leary of what any one analysts says or recommends!!

Johndormer is correct in pointing out that MGM China is MGM's bright star. Unfortunatly, the vast majority of MGM's business remains in Vegas and CityCenter has turned out to be the most colossal flop in Vegas since the Aladdin had to be done over by PH.

Meanwhile, Sands China's new "Cotai Central" resort on China's cotai strip will be bigger than 3 or 4 MGM Chinas and will result in over 90% of Las Vegas Sand's revenues and EBITDA originating from the booming far east gaming markets...

Why is it that the FOOL is really the motley fool? Are we supposed to take you seriously when you are not held accountable for all of the bad and incorrect views you have given out over the years. Do you remmeber your sell viewpoint of Sunoco (SUN)? it is up SUBSTANTIALLY since you said to sell. As far as MGM is concerned how about actually doing your research! The hotel they're imploding is the Harmon and and it was nover occupied. The only disruption to the bottom line is the implosion costs which they will probably get back in the lawsuit with the construction company, and if not it is a minor blip on the overall picture. MGM Grand in Macau makes more money for the company in a month than at least 6 ,months of Vegas revenue. And as for the Vegas holdings, have you been to Vegas lately? If you want luxury you stay at Wynn/Encore, Venetian/Palazzo, and a whole lot of MGM Resors (Aria, Bellagio, Mandalay Bay, MGM Grand, The Mirage) There really is no other company out in Vegas that can compete. Ceasar's is totally out of it, maintains run down facilities, including Ceasar's Palace and Total Rewards is a joke compared to Mlife. Why don't you guys get with it. As far as Kerkorian is concerned whoaaaa, he sold another 5% of his stock holdings. Why weren't you talking about this for the last three years. Since this last sale he's down to owning 22% of the company. Three years ago he held reasonably over 50% and has spent the last three years paring down his holdings. And now this is reportable? You guys are like S&P, don't say anything of importance while it's actually happening but try to create a buzz at a time when it's really not much at all. And finally, why do you not mention about MGM in Vietnam? Once that opens in a couple of years they will be the only player there for a couple of more when Pinnacle will open up a resort there as well. So please, in the future please do your legwork and provide some reall updated facts!!!